Comments for HotShot Delivery Blog

Comment on Stranded Freight and Bad Ribs by Nia Noaks

Nia Noaks — Wed, 17 Feb 2010 21:51:31 +0000

Great Post! I love reading it.

Comment on Family Expansion by Dot Dwan

Dot Dwan — Wed, 17 Feb 2010 08:53:21 +0000

I concord with your viewpont and will certainly see your future posts

Comment on Stranded Freight and Bad Ribs by Jamie Dolan

Jamie Dolan — Thu, 11 Feb 2010 06:34:37 +0000

Thanks for the blog post! Have a great morning! -Jamie Dolan- Neenah, WI

Comment on Back To The Basics by John David

John David — Sat, 06 Jun 2009 12:11:06 +0000

Are you saying that your increasing rates in this tough times?

Comment on Back To The Basics by Eric Donaldson

Eric Donaldson — Sat, 06 Jun 2009 11:59:09 +0000

John, thanks for asking. Actually, I am lowering rates in many cases and spending a lot of time evaluating all business costs. What I’m really doing is making sure that those “special accounts” that we all have at times are in fact profitable. For example, I have a friend in the distribution game that has a customer stretching his payments out 90 days or more on each invoice. My friend is borrowing off his credit line at a rate of 5.5% and his margin for this customer is 4%. 4 minus 5.5 is not helping here! The way I see it, my friend has two options: 1.) Cut expenses overall and especially those directly related to this customer (by the way, running slim and efficient always makes you more money and I suggest it as long as you are not too slim to give GREAT service) 2.) Renegotiate with this customer on ALL terms of the relationship. It may be that the same Cash Flow headache is beginning with the customer’s customer, so he had no choice but pay in 90 plus days. If so, perhaps a rate increase is in line or a change of the service requirements. Perhaps they need to alternate days of service so that instead of running parts daily, they run every other day and reduce the rate a bit to help bring down the expense.

John, with proper communication and analysis, it is very possible to reduce rates and increase margins. Bottom line, be mindful of the True Costs associated with running your business. In tough times people have a tendency to accept any rate just to have cash coming in the door. Even when, like above, it costs more to service the customer than you actually make. Selling cheap (below costs) is a sure fire way to be out of business soon.

Oh, one last thing. You can’t “make it up in volume” as some people say. If it costs 5.5% to service and you are making 4% to start with, no amount of volume makes up for a negative margin deal.

Vince, are you reading this?

Thanks for commenting John!
Eric

Comment on Family Expansion by WOG

WOG — Fri, 27 Feb 2009 19:38:46 +0000

Really beautiful baby, Eric. Congratulations to you and your family.

Comment on Recession-Proofing Your Business by Jennifer Cope

Jennifer Cope — Wed, 18 Feb 2009 20:30:11 +0000

Love the blog! Very good information to get out there.

Comment on New Year’s Resolutions — How I’m Doing So Far by Mary Walker

Mary Walker — Thu, 05 Feb 2009 04:10:01 +0000

I love this post! It’s so true – as a small business owner, I often find myself struggling with the same issues. Simple structures and set goals really make a huge difference.